Category: Real Estate

Reasons To Use A Real Estate Agent To Sell Your Maui Home

Maui real estate
People often try to sell their home on their own (FSBO…For Sale By Owner). While this may certainly work for some, there are several things you should consider before you list your home yourself. Real estate agents perform many important services and often times deliver better results than a home seller could achieve on their own.

Advertising

According to NAR (National Association of Realtors), here’s where buyers found the homes they actually purchased:

  • 55% on the Internet
  • 28% from a Real Estate Agent
  • 10% Other
  • 6% from a Yard Sign
  • 1% from Newspapers

The days of selling your house by putting up a sign in your yard or placing an ad in the paper are long gone. Having a strong internet marketing strategy is crucial.

Negotiating

Here’s a list of some of the people with whom you must be prepared to negotiate if you decide to FSBO:

  • The buyer, who wants the best deal possible
  • The buyer’s agent, who solely represents the best interest of the buyer
  • The buyer’s attorney (in some parts of the country)
  • The home inspection companies, which work for the buyer and will almost always find some problems with the house
  • The appraiser, if there is a question of value

Paperwork

The paperwork involved in buying or selling a home has increased dramatically as industry disclosures and regulations have become mandatory. This is one of the reasons the percentage of people FSBOing has dropped from 19% to 8% over the last 20+ years.

Sales Price

Many homeowners believe they’ll save the real estate commission by selling on their own, but the seller and buyer can’t both save the commission. A report by Zillow revealed that FSBOs are inclined to do so because they believe it will save money, but they don’t actually save anything, and eventually end up listing with an agent. The same report revealed that, “While 36% of sellers that (at first) attempted to sell their homes on their own, only 11 percent of sellers—in other words, less than a third…actually sold without an agent.”

Questions to Ask Before Buying a Fixer-Upper in Maui

Maui fixer upper
The last thing you want to do is purchase a home that ends up costing you more to fix than you calculated for. So before you spend a lot of your time and money on a fixer-upper, you need to know the questions to ask first.

Is the Investment Worth It?

Deciding on whether to purchase a fixer-upper is a big deal. You need to make sure that it’s an investment you’re willing to commit to. If you have a contractor, they’ll make you aware of the state of the home, and also give you a rough estimate of the total costs of fixing the house.

Even when you have a trusted contractor, it’s essential to have a professional home inspector look over the property. A home inspector is trained to find problems that a contractor might otherwise overlook, discovering what is often referred to as “inspection deal breakers.”

Do You Have the Time to Invest?

This is a project that’s going to take up a ton of your time. Whether you have any help or not, at the end of the day, it’s going to be your home. That means you’ll be in charge of that home day in and day out.

If anything goes wrong and there’s an accident that occurs in the home, you’ll be the only one responsible for dealing with that situation. So if you’re serious about buying fixer-uppers, you need to learn how to manage your time. Additionally, if you’re not looking to hire a contractor, you will need more time to spare.

Do You Have the Money to Invest?

You need to be 100-percent sure that you have the money, or be willing to obtain the necessary funds to purchase the home and have it fixed. Like most fixer-uppers, you can never perfectly calculate the final costs, so be ready to pay a little more if things don’t go as planned. One of the most significant mistakes is not realizing there’s a difference between a fixer-upper and a rehab home. When you don’t understand this distinction, your budget can get shot very quickly.

If you’re getting a loan, you need to make sure you know exactly what you’re signing up for. A mortgage is a serious commitment of your trust and fiscal responsibility. If you have bad credit, a loan will probably be a bad idea for you. It’s advisable to get your financial house in order before committing to more debt.

Is the Home in a Good Area?

One of the biggest mistakes both investors and traditional homebuyers make all the time is discounting the importance of location. Agents constantly talk about how critical the location is in the grand scheme of things. It’s vital for your home to be in an excellent area. The location of your home helps determine how much your home appreciates over time.

Even the type of road a house sits on affects the price. The difference in value from a home located on a busy street versus a quiet neighborhood can be night and day. Great schools and public transportation are just some of the things you need to look at when purchasing a fixer-upper home.

Make sure to get a feel for how appreciation has been over the last decade. Is it keeping up with other surrounding areas? Consult with your buyer’s agent to get their opinion of how the appreciation will be before moving forward.

If you’re looking to start buying fixer-uppers, you have to able to spend a ton of time doing your research first. Additionally, as a beginner, you can make many mistakes, and it happens to a lot of people at some point. Don’t let your fixer-upper become a rehab money pit!

When a House Becomes a Home

Maui real estate
We talk a lot about why it makes financial sense to buy a home in Maui, but more often than not we’re drawn to the emotional reasons for homeownership.

No matter the size or shape of a living space, the feeling of a home means different things to different people. Whether it’s a certain scent or a favorite chair, the feel-good connections to our own homes are typically more important to us than the financial ones. Here are some of the reasons why

Stability to start and raise a family

From the best neighborhoods to the top school districts, even those without children at the time of purchase may have this in the back of their minds as a major reason for choosing the location of the home they purchase.

There’s no place like home

Owning your own home offers not only safety and security, but also a comfortable place where you can simply relax and kick-back after a long day. Sometimes, that’s just what we need to feel re-charged and truly content.

More space for you and your family

Whether your family is expanding, an older family member is moving in, or you need to have a large backyard for your pets, you can take all this into consideration when buying your dream home, so the space truly works for you.

Control over renovations, updates, and style

Looking to actually try one of those complicated wall treatments you saw on Pinterest? Tired of paying an additional pet deposit for your apartment building? Maybe you want to finally adopt that fur-baby puppy or kitten you’ve been hoping for. Who’s to say you can’t do all of these things in your own home?

States With the Largest Home Equity Gains

Maui home value
National home equity in the third quarter of 2019 rose 5.1% year over year, reaching an average of $5,300 per homeowner, according to CoreLogic’s Home Equity Report. States that saw the largest equity gains are Idaho (where homeowners saw an average increase of $25,800), Wyoming ($24,000), Utah ($21,000), and Montana ($17,800).

Maui home equity

Meanwhile, the number of homes with negative equity, meaning the owners owe more on their mortgage than their property is worth, dropped by 4% to 2 million—or 3.7% of all properties with a mortgage. “Ten years ago, during the depths of the Great Recession, more than 11 million homeowners had negative equity, or 25% of mortgaged homes,” says Frank Nothaft, CoreLogic’s chief economist. “After more than eight years of rising home prices and employment growth, [the number of] underwater owners has been slashed.”

Source: “Homeowner Equity Report,” (December 2019) CoreLogic

Home Prices Could Increase 5.4% by October 2020

Maui home values
Home prices grew by 3.5 percent year-over-year in October and are expected to rise by 5.4 percent by the same time next year, according to a CoreLogic Home Price Index and Forecast report. Between September and October 2019, home prices grew by 0.5 percent.

Nationwide, home values have been growing steadily since 2012 and the recovery period that followed the recession. February 2016 saw peak year-over-year growth at 4.2 percent. But now, CoreLogic’s economists predict new peaks for the coming year.

While low mortgage rates and a strong job market increase Americans’ homebuying ability and therefore competition for homes, some parts of the country are not reaping in the prosperity at equal rates. Thirty-five of the country’s 100 largest cities currently have an overvalued housing market while the Northeast division comprising New York, New Jersey and White Plains saw housing values fall by 1 percent over the last year.

“Local home-price growth can deviate widely from the change in our U.S. index,” said Dr. Frank Nothaft, chief economist at CoreLogic. “While we saw prices up 3.5 percent nationally last year, home prices also declined in 22 metropolitan areas. Price softness occurred in some high-cost urban areas and in metros with weak employment growth during the past year.” That said, the numbers show that the overall American housing market is looking fairly strong — and buyer sentiment is also changing to reflect its current conditions.

Should You Rent Or Own If You’re Retired?

Maui real estate
For many of us, the decision to rent or buy is dictated by our income. But for retirees, who are typically on a fixed income, deciding between renting and buying isn’t such a simple calculation. Retirees may choose to relocate for a variety of reasons, including downsizing, being closer to family, or to enjoy a warmer climate. But no matter what your motivation for moving, you may be wondering if renting or buying a home in is the smart choice. If you find yourself in a similar dilemma, ask yourself the following questions.

How stable is your income?

When you’re on a fixed income, it greatly helps to have fixed housing costs. That’s why taking out a mortgage might make sense for retirees. Having to worry about rising rent costs when you’re on a fixed budget can be stressful; owning your home means you have one flat payment every month that is also building equity for the future.

However, in some markets, renting may be a good financial decision. The overall cost of renting may be cheaper than buying—when you leave equity out of the equation.

It’s also much cheaper to move from one rental property to another than it is to sell a house because you don’t have to worry about closing costs, homeowners insurance, a large down payment, etc.

Can you afford routine maintenance?

One major concern for retirees to consider is the upkeep and maintenance that inevitably comes with owning a home. Cutting the grass, painting, and other home maintenance tasks are a hassle for anyone, but even moreso for retirees. Of course, these projects can be outsourced, but that costs money. And major home repairs—like a new roof, plumbing, or HVAC—can run to several thousands of dollars.

Do you qualify for a mortgage?

If you decide to downsize your home or move to another location, you may need to obtain a mortgage on your new home. Before 2008, it seemed like you could get by with a large down payment and good credit history to obtain financing. Today, one of the more important factors is income, so the money you might be receiving from Social Security or your pension must be sufficient to qualify you for the mortgage on the property you want to acquire.

Selling Your Maui Home? Here’s How To Make It Look Its Best Before Showings

Maui real estate
While there are many things you can do to make your Maui property look it’s best before showing to a potential buyer, here are four of the most important aspects to highlight:

Appeal

Appeal reigns supreme when it comes to attracting prospective buyers. They’re looking for an attractive residence that’ll present a welcoming façade and inspire pride in ownership. Inspect the interior and exterior of your Maui home from a buyer’s perspective. Every room and space inside, as well as the lawn, walkways and outbuildings, should be aesthetically appealing with coordinated colors and designs. Mismatches in structure or decor are usually a turnoff to those seriously interested in purchasing a home.

Cleanliness

Everything should be orderly. Get rid of trash, debris and weeds that can make the property appear uncared for. Unused items that are stored in closets, cupboards, the attic or the garage should be removed to make those areas appear more spacious and useful. All surface areas, including counters, floors, walls and ceilings should be free of dust or stains. Bathrooms should appear especially tidy and free of moldy tiles or rusty fixtures.

Freshness

Even a mansion can appear old and uninviting. Freshen the paint indoors, replace missing tiles and hardware and upgrade bathroom fixtures. Hardwood floors can be polished, or new carpet may be installed. Windows should be clean without spots or stains. Everything about the property should look well cared for and updated. Up the ante even further by cutting the grass and weeding any flower beds on the property.

Functionality

Make sure everything about the property is in good working order. Check electric switches and replace burned out bulbs. Check to see that cabinet drawers close completely and evenly. Inspect appliances and equipment for any problems or flaws that should be fixed before the property goes on the market. Creaking doors can be lubricated. Broken window latches should be repaired or replaced. Ensure the toilet flushes completely and that no faucets are leaking. Additionally, do a walk-through of the property and visualize how prospective Maui buyers might see the space.

Article by: Lizzie Weakley

Build A New Home Or Buy An Old One?

Maui new home
Generally speaking, it makes sense to search for older things rather than their newer counterparts when you want to save money. This doesn’t, however, always hold true when it comes to buying a home. Here are several factors that may lead to older homes costing more than new construction:

Energy Efficiency

One of the great things about buying a new home is that everything inside is new. This generally means that most of the appliances and systems were built in the last few years, which in turn means that they tend to be more energy-efficient. On top of better appliances, newer homes feature the latest in design for insulation, from the framework to the material used in building. This means that, over time, the cost of owning new construction can actually be substantially less than the cost of owning an older home.

Perks Specific to Older Homes

Sometimes buying an older home can also cost more simply because it has perks that aren’t available in new homes. Classic architecture, antique fireplaces or period-specific additions can command a great deal of money, and they’re simply not features that you get in a newer home. Buyers who want these features are willing to pay a premium, which drives up the price of homes that have those touches. As such, new construction may be much cheaper in comparison.

Maintenance Costs

Older homes cost more to take care of than newer homes, if only because time tends to be unkind to any building. In the short term, at least, it’s also more likely that a homeowner would have to replace big-ticket items in an older home than in a newer home. New construction homes may cost more upfront, but the actual cost of living in an older home will generally be quite a bit more.

Property Value

In many cases, the true cost of a home comes down not to the style of the house or what perks it offers, but rather the value of the property on which it sits. New construction can often be less expensive simply because the area in which it was built hasn’t had time to gain the same sort of social cache as older construction. An older home in a well-established neighborhood is almost always going to cost more than new construction in a less desirable area.

Old homes aren’t always cheaper than their newer counterparts. Even when new construction costs more to buy, it can still cost less than living in an older home. As such, it’s always a good idea to look at both types of homes in Maui when you’re trying to find something that will fit your budget!

Article from Meghan Belnap

Tips for Starting a Home Search

Maui real estate
In today’s market, low inventory dominates the conversation in many areas of the country. It can often be frustrating to be a first-time homebuyer if you aren’t prepared. Here are some tips to help you get started with your Maui home search.

Get Pre-Approved for a Mortgage

One way to show you’re serious about buying your dream home in Maui is to get pre-qualified or pre-approved for a mortgage. Even if you’re in a market that is not as competitive, understanding your budget will give you the confidence of knowing whether or not your dream home is within your reach. This will help you avoid the disappointment of falling in love with a home well outside your price range.

‘Must-Haves’ vs. ‘Would-Like-To-Haves’

Do you really need that farmhouse sink in the kitchen to be happy with your home choice? Would a two-car garage be a convenience or a necessity? Before you start your search, list all the features of a home you would like. Qualify them as ‘must-haves’, ‘should-haves’, or ‘absolute-wish list’ items. This will help you stay focused on what’s most important.

Research and Choose a Neighborhood

Every neighborhood has unique charm. Before you commit to a home based solely on the house itself, take a test-drive of the area. Make sure it meets your needs for “amenities, commute, school district, etc. and then spend a weekend exploring before you commit.”

Pick a House Style and Stick to It

Evaluate your family’s needs and settle on a style of home that will best serve those needs. Just because you’ve narrowed your search to a zip code doesn’t mean you need to tour every listing in that vicinity. An example from the article says, “if you have several younger kids and don’t want your bedroom on a different level, steer clear of Cape Cod–style homes, which typically feature two or more bedrooms on the upper level and the master on the main.”

Document Your Home Visits

Once you start touring homes in Maui, the features of each individual home will start to blur together. The article suggests keeping your camera handy and making notes on the listing sheet to document what you love and don’t love about each property you visit.

In a high-paced, competitive environment, any advantage you can give yourself will help you on your path to buying your Maui dream home.

From realtor.com’s article, “How to Find Your Dream Home—Without Losing Your Mind.”

How Local Schools Can Impact Your Home’s Value

Maui real estate
Schools are, of course, an influence on surrounding home prices. A good school district can increase buyer demand within its boundaries, which in turn increases home values. Homes located in high-scoring school districts attract more buyers, including parents who want their children to go to good schools and others who understand that a good school district helps protect a home’s resale value.

On the flip side, a struggling school district can experience less buyer demand, which restrains home values. In addition, a low-scoring public school can decrease the availability of amenities in the area and increase the proportion of renters to homeowners.

Home prices are generally not as impacted by nearby private schools, since attendance to private schools is not dependent on home location. That same theory can sometimes apply to public schools: Even if two elementary schools feed into the same high school, the more desirable elementary school could easily command higher home prices within its attendance boundary.

Prospective homebuyers should explore school districts’ websites and visit schools personally to meet with administrators when house-hunting with education in mind. They should also be aware of educational options offered by the district that are not dependent on property location, such as magnet programs and charter schools. For example, many lower-performing high schools and elementary schools receive additional financing and special support; the homes surrounding these schools may be priced lower than those in better districts nearby, yet still offer good educational opportunities.

Buyers can benefit by engaging a local REALTOR® for assistance. In addition to offering traditional services (facilitating showings, negotiating contracts, recommending lenders, following inspections, etc.), REALTORS® can serve as the expert “source of the source” when it comes to educating buyers about districts and schools. District and individual school websites are valuable resources, as are state departments of education. Even private publications and online entities uncovered by a simple Google search gather data and post reviews, and many offer rankings.

Source: Jeffrey Fagan, President for the Orlando Regional Realtor Association